Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/93452 
Year of Publication: 
2014
Series/Report no.: 
CESifo Working Paper No. 4587
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We consider a simple two period model where consumers have different switching costs. Before the market opens, there was an incumbent who sold to all consumers. We identify the equilibrium both with Stackelberg and Bertrand competition and show how the presence of low switching cost consumers benefits the incumbent, despite the fact that it never sells to any of them.
Subjects: 
switching cost
JEL: 
D43
L13
Document Type: 
Working Paper
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